Nintendo Financial Results: 3rd Quarter of Fiscal Year Ending March 2023

Nintendo’s financial results for the first nine months of the fiscal year ending March 2023 reflect a period of contraction compared to the previous year. Net sales declined by 1.9% to 1,295.1 billion yen, while operating profit fell by 13.1% to 410.5 billion yen. This downturn was driven by lower-than-expected hardware and software sales during the holiday season, compounded by increased material costs and a shift in the hardware sales mix toward the lower-margin Nintendo Switch OLED model.

The company’s primary business segment, dedicated video game platforms, saw a 2.0% decrease in sales. Hardware unit sales for the Nintendo Switch family dropped 21.3% to 14.91 million units, while software unit sales declined 4.0% to 172.11 million units. Despite these challenges, the business maintains a strong foundation, with the number of annual playing users exceeding 112 million. Digital sales emerged as a significant growth area, rising 21.5% to 310.0 billion yen and accounting for 46.0% of total software sales, bolstered by the success of major titles such as Pokémon Scarlet and Pokémon Violet, which achieved 18.2 million units in global sell-through within seven weeks of release.

In response to these performance trends, the company revised its full-year consolidated earnings forecast downward. The net sales projection was adjusted to 1,600.0 billion yen, and the operating profit forecast was lowered to 480.0 billion yen. The hardware unit sales target for the fiscal year was reduced by 1.00 million units to 18.00 million, with a corresponding downward adjustment for software. Moving forward, the company aims to sustain engagement through a robust 2023 software release schedule and strategic initiatives to expand the reach of its intellectual property, including the expansion of Super Nintendo World and the release of The Super Mario Bros. Movie.